The effect of cancer diagnosis on switching health insurance in medicare

Abstract

Because health insurance is intended to protect patients in the event of a health shock, it is important to evaluate health insurance policy in the context of patients who experience health shocks. I measure the effect of cancer diagnosis on health insurance switching in order to compare cancer patient's preferences among private and publicly administered Medicare. I estimate that a cancer diagnosis increases the probability a patient will leave a private Medicare plan, for the public plan, by 0.8% points (41%). Similarly, a cancer diagnosis decreases the probability a patient will leave the public Medicare plan, for a private plan, by 0.5% points (16%). The implication is that private Medicare plans are relatively less attractive to cancer patients than they are to noncancer patients.